Ford Lowers 2016 Pre-Tax Profit Forecast on Expanded Recall

Ford Motor Co. lowered its 2016 adjusted pre-tax profit forecast to $10.2 billion from the at least $10.8 billion it forecast in July because of a $640 million charge for an expanded vehicle recall, the company said on Thursday.

The recall is for side-door latches that may come unhinged while vehicles are in motion. It was expanded on Thursday by 1.5 million vehicles to 2.4 million vehicles.

“With this expanded (recall), we now expect our 2016 total company adjusted pre-tax profit to be about $10.2 billion. We continue to expect our total company adjusted pre-tax profit in the third quarter of 2016 to be about 10 percent of our full-year 2016 results,” Ford said in a filing with the U.S. Securities and Exchange Commission.

That would suggest a third-quarter adjusted pre-tax profit of about $1 billion, down about 60 percent from $2.7 billion a year earlier. Last year, Ford set a company record for any third quarter’s adjusted pre-tax profit.

Ford f said in July that the second half of 2016 will not be as profitable as the first half of this year, when it recorded $6.8 billion of adjusted pre-tax profit. That is partly because of beneficial factors that will not reoccur in the second part of the year and the expense of the rollout of Ford’s highly profitable Super Duty large pickup trucks.

Ford shares on Thursday morning were down nearly 0.5 percent at $12.64 in New York trading.

When it issued second-quarter financial results in late July, Ford said its 2016 adjusted pre-tax profit would be equal to or greater than last year’s $10.8 billion.

Ford said the new expense will show in its third-quarter results and primarily in North America, its most profitable region which has been driving record company profits recently.

The company has recalled nearly 4 million vehicles for door latch issues in six separate recalls since 2014.

Ford said the latest expansion was at the request of the U.S. National Highway Traffic Safety Administration after the automaker in August issued a regional recall covering 830,000 vehicles.

Security Experts Say That Hacking Cars Is Easy

Automobiles may be getting more advanced, but that doesn’t mean they are immune to hacks.

The latest cars, stuffed with technology that collects driving data and makes keys obsolete, are far “smarter” than older vehicles. However, all those features come at a cost when it comes to how easily hackers can infiltrate car computer systems.

Security researchers from the University of Washington and the University of California, San Diego took to the stage at a conference on Tuesday to describe how they were able to remotely break into vehicle electronics through an array of security holes. Speaking at the Enigma Security Conference in San Francisco, they discussed how cars have evolved over the years into computers on wheels that crafty hackers can penetrate under the right circumstances.

One particularly sensitive entry point for hacking is the legally required OBD II port, which is basically “the Ethernet jack for your car,” said Stefan Savage, a University of California, San Diego professor of computer science and engineering. It is typically located below the dashboard on the driver’s side.

This port acts as the car’s command center that connects to all of the different computers systems, said Savage. Mechanics often plug directly into this port to retrieve diagnostics for the car’s emissions, mileage, and engine errors.

However, hackers who directly connect their laptops to the port through an intermediary device can basically plug into car’s control system and “have access to everything,” said Savage. “Once you get inside this network, all bets are off,” he said.

With cars containing multiple computers coupled together through a maze of networks, it’s also possible to break into the car’s command center without having to physically plug something into the port. Hackers just have to find a hole somewhere within one of the networks to sneak in.

These holes are often created from software conflicts that emerge when code from one device like a CD player communicates with code from another device like a car’s on-boarding system. There’s so much code in a typical car from so many different vendors that it can be virtually impossible for auto makers to know all the software inside their vehicles, he explained.

In 2010, Savage and his and his research team demonstrated how they were able to wirelessly hack into the command centers of a 2009 Chevy Impala through the OBD-II port. They were able to manipulate the car’s braking system so that the vehicle suddenly stopped or failed to function at all.

Wiredreported that it took General Motors gm five years to completely fix the bug and ensure that future models wouldn’t have the same vulnerabilities.

Savage stressed that the hacking incident on GM and similar research-led hackings into car models like the Toyota Prius and Ford f Escape don’t show that any one company’s cars are more vulnerable than the next. Instead, it’s an industry wide problem. It used to be that manufacturers didn’t typically have cyber security response teams or other means to effectively deal with the issues, he explained.

Indeed, at the time of the Chevy Impala hack, GM “didn’t have anyone to deal with cyber security” and regulators didn’t know how to address the problem, said Savage. However, his team worked closely with GM to fix the problem and the company has since installed a chief security officer in charge of product and now has a 100-person strong cyber security team. The company also changed its overall development progress and is trying to patch possible bugs in its systems before they become public, he explained.

“I’m not going to tell you there aren’t vulnerabilities in GM’s cars, but they are in a much better position than what we started in 2010,” said Savage.

For more on GM watch our video:

It’s worth noting that the researchers were able to pull off their hacks in staged projects in the lab. Just because they discovered them “doesn’t mean [the problems] will necessarily manifest in the real world,” said University of Washington professor of computer science and engineering Tadayoshi Kohno.

The researchers argued that security experts must continue to make bugs public if the auto industry fails to address its loose security standards. Hopefully, they said, it will prevent disasters before they happen on the road.

Ford Launches Smartphone App to Give Drivers Remote Access

Ford Motor Co. has announced a new LTE-based service that will let drivers control car functions—such as unlocking and locking doors and remotely starting the engine—via a smartphone app.

The Sync Connect technology, which connects to a built-in modem inside the vehicle, will make its global debut in the new 2017 Ford Escape this spring with more vehicles to follow, announced the company at the Connected Car Expo and LA Auto Show. The new Ford Escape, which includes driver-assist technologies such as active park assist and a lane-keeping system, will also be unveiled at the LA Auto Show.

One of the car’s most interesting features is the ability to schedule your remote start, which could come in handy on cold, snowy days. Sync Connect will also let customers use their smartphone to check fuel, oil and battery levels as well as tire pressure readings. There’s also a vehicle location feature. Users can access the connected car tech via a two-step authentication process designed to protect personal information, after confirming setup on the vehicle touch screen and its mobile application.

Ford F says it will also offer five years of free complimentary service for the technology.

Ford execs are quick to note that Sync Connect will play a key role in Ford Smart Mobility—the company’s plan to deliver the next level in connectivity, mobility, autonomous vehicles, customer experience and big data. Although, Ford didn’t provide any additional information about what this next level might look like and when the public can expect it.

The company is increasing its resources and investment in mobility projects, which right now hovers at around 25 programs and includes an on-demand car-sharing pilot in London and Park Spotter, which leverages driver-assist sensors found in most Ford vehicles to search for open parking spaces. Data obtained from the sensors is uploaded to a cloud database and shared with other drivers, so they can can find their own parking spaces.

In the past year, several automakers—including GM, Hyundai and Mitsubishi—have announced plans to offer services from Apple CarPlay or Android Auto (and in some cases both), which lets drivers control car apps (such as Google Maps and Rdio) using their smartphone.

Meanwhile, Ford is committed to keeping Sync—the company’s in-car communications and entertainment system that lets you use your voice to make calls, listen to music, control car functions, and select apps through its AppLink technology—in future vehicles. Sync Connect will simply build off of Ford’s current system.

Ford also announced in June 2015 that a new version of Sync 3 will debut in Fiesta and Escape models. The Sync in-car system is now in 12 million vehicles around the world.

Ford recalls nearly 1.4 million vehicles

Continuing what has been a year heavy in American auto recalls, Ford Motor Company F on Thursday issued four separate vehicle recalls that cover almost 1.4 million automobiles, according to Reuters reports.

The company said it will recall 915,216 North American Ford Escape and Mercury Mariner SUVs from 2008 to 2011 model years because of a potential loss of power steering, which can increase the risk of a crash at lower rates of speed, Reuters said.

The steering problems have reportedly led to six crashes and five injuries.

Ford also reportedly said 195,527 Explorer SUVs in North America from the 2011 to 2013 model years will be recalled.

Separately, Ford said it is recalling nearly 200,000 Taurus sedans in North America from the 2010 to 2014 model years over a corrosion issue, plus 82,576 sedans with floor mats that may inhibit accelerator pedals, Reuters said. These floor mats were put in 2006 to 2011 model year Ford Fusion and Mercury Milan and Lincoln Zephyr and MKZ sedans, according to the report.

In total, the day’s recall tally comes to nearly 1.4 million vehicles.

A spokesperson for Ford was not immediately available for comment.

Ford rival General Motors and the U.S. Department of Transportation recently agreed a settlement over the timing of GM’s reaction to an ignition switch flaw that led to a recall of more than 2 million cars.